Replace a Qualifier, C-12 and Corporate Licenses

Let’s apply some ‘anti’ –septic advice to a contract an attorney says ‘stinks’. After getting ‘down to earth’ with that answer, I will share expert advice on how incorporation can affect your current license if you are considering some reorganization in the current economy…

Q: I have a client who holds a “C-12” Earthwork and Paving license. They are under the impression that their license allows them to also install septic systems and make water and sewer line connections.

They stated that the CSLB told them this was acceptable as long as the work was all related to the grading and excavation they were doing. I believe this is incorrect and that they need to have a Class “A” license. Please advise.

A: In my opinion, based on your explanation, it would appear the “A” rather than “C-12” is the correct license classification. If the project involves installing a septic system, hook-up of water and sewer lines, and piping, these fall under the “A” — or in many cases the “C-42″ (Sanitation systems) or “C-34″ (Pipeline) classification. While contractors can perform work that is incidental or supplemental to their contract, this does not appear to be the case here.

The “C-12” contractor “digs, moves, and places material … to cut, fill excavate, trench, grade, backfill or tunnel”. Nowhere does this classification mention hooking up water or sewer lines or installing sanitation systems. Your client may have it backwards; whereby installation of a septic tank or drainage system, water or sewer line hook up, or laying pipe, would allow for the incidental earthwork and subsequent paving but NOT visa versa.

Q: I have formed a California corporation and wish to use my existing “B” contractors license. Can I do that? Will the corporate liability umbrella cover my license or not?

A: You must apply for a new contractor’s license and can choose to assign your sole owner license to the corporation or have the CSLB issue you a new number. Check with your insurance company regarding whether your current liability policy will cover this new license.

Q: As a follow-up to our discussion, how does my company seek to extend the 90-day “grace period” for replacing a Qualifier with an additional 90 days? I assume that must be requested in writing? Are there forms that need to be filled out and sent in?

A: The first 90-days is automatic from the date your Qualifier leaves a license. The only exception is a Partnership where a “qualifying PARTNER” disassociates thereby causing the license to be CANCELLED. The additional 90-day extension must be requested in writing within this “grace period”’ and must be accompanied by an Application to Replace the Qualifying Individual. While this is not addressed in the law, it is the Board’s policy to only grant this additional time if the company is attempting to qualify someone new.

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Thanks for your help on our license application. You and your staff were very helpful and responsive. The assistance and peace of mind you provided throughout the process was well worth the cost. I would recommend Capitol Services without hesitation.— Stephen Mink, Coast Construction Co. - Oakland, CA